Ige outlines features of new financial plan to cope with COVID-19 pandemic

  • IGE

Tough financial times are ahead for the state.

Gov. David Ige said at a press conference Monday that during the prior fiscal year, the state collected $7 billion in taxes, and in the fiscal year that ended June 30, it collected $6.5 billion, a 7% decrease.


“But all of you know that we were running along very fine, through the end of the year on record pace,” Ige said. “January, February, March, the revenues had no impact from this COVID pandemic, and then we saw the degradation in April, May and now finally June. So we do know that COVID-19 will have a significant impact on the state’s finances. So we went from a record year to a significant loss in the matter of three months.”

State tax revenues were down about 25% in June compared to the same month last year, from $644 million to $483 million. Revenue projections anticipate a tax revenue shortfall of $2.3 billion in the next 12-15 months.

As a result of a mandatory 14-day quarantine for incoming visitors, Ige said more than 200,000 Hawaii residents have lost their jobs and sought unemployment benefits.

“You probably know someone … who is facing challenging financial times, and as difficult as it has been, we haven’t felt the full financial pain yet,” Ige said.

Some $4 billion in federal funds has kept state finances afloat during the COVID-19 pandemic, but Ige said that money is drying up.

In light of the looming financial challenges, Ige said the state is seeking a loan from the U.S. Department of the Treasury, implemented a hiring freeze, is working with state agencies on possible reductions and wants to stop non-personnel expenditures.

The last part of the budgetary puzzle will be payroll savings, he said.

“I want to assure you that our planning and our decisions will be based on facts and the numbers that we see,” Ige said. “We are facing a challenging future and we will attack it head on. There are no easy answers and tough decisions will be needed to be made in the next weeks and months ahead.”

Ige thinks the shortfall will be temporary and reopening the state economy to trans-Pacific visitors will help improve the financial situation.

A mandatory 14-day quarantine implemented in late March will be lifted Aug. 1, when out-of-state travelers who have tested negative for COVID-19 can enter Hawaii without having to quarantine.

The state, however, has seen an uptick in cases in recent days.

After a holiday weekend that saw more than two dozen new cases each day Friday, Saturday and Sunday, just seven new cases of COVID-19 were reported Monday, including six on Oahu and one on the Big Island, bringing the statewide tally to 1,030.

A total of 94 cases have been reported on Hawaii Island, 87 of which have been released from isolation.

While some of the state’s newly reported cases were identified through contact tracing, the state Department of Health said many were not associated with known cases, which means the virus is circulating in the community.

Lt. Gov. Josh Green, a Big Island physician, however said the state’s health care capacity is in good shape.


Currently 120 of 244 intensive care unit beds, or 49%, are in use, while just 53 of 459 ventilators are in use. Few of those — three and two, respectively — and are being used by COVID-19 positive individuals.

“The uptick we’ve seen in cases over the last few weeks has been concerning for many … but things have changed,” Green said. “We have opened up our kamaaina economy and it’s providing a lot of people an ability to work again here in the state. We have not had significant consequence at our hospital level, which is good news.”

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